Don't Budget: Try Job Hopping (Part Two)

Previous post: Don't Budget: Try Job Hopping (Part One)

A Quick Recap

In part one, we explored two options for increasing our savings: growing our income or decreasing our expenses. We looked at the example of Bold Brooklyn and Self-Control Salem and I made my case that focusing on income is a better way to maximize your financial potential. This is probably true for you if:

You don't have credit card debt.
You safely avoid big money mistakes (we'll take a look at what those are in a future post).
You invest each month into low-cost index funds in a retirement account.

If all those are true, then you're already crushing it! You're in a perfect spot to focus on income growth to see your biggest financial gains. If not, take a closer look at your spending. You may have a lot of room for improvement in your expenses still.

How to Grow Your Income

Unfortunately, I don't have any amazing get-rich-quick schemes that will double your income overnight. But I do know two ways to grow your income, confidence, and capability if you're willing to invest some time and hard work: getting promoted and getting a new job. And of the two (in my experience), getting a new job provides way more growth, especially early in your career.

Increasing your income as an employee is a pretty simple three step process. First, you'll need to gather info on internal (your current company) and external (other employers) opportunities. Second, decide which approach looks like a better return on investment for your effort (promotion or job hop). Third, attack the opportunity you're going for strategically.

Investigate Opportunities: Getting a Promotion/Raise

This step is pretty easy. It just requires a little bit of research: reading company policy, asking your boss/mentor for advice, and observing for yourself how things are done at your company. There's a ton of questions you should know the answer to before you decide if working towards a promotion/raise is worth your time. A few examples to get you started:

How much more would you make? A 5% raise is kind of interesting, a 20% raise is very interesting.
What are the requirements to get promoted or get a raise? Is there a concrete rubric you need to pass? Do you need to get on more visible projects? Is it all about who you know? Is your boss going to be a good advocate for you or do you need to find someone else?
How long would it take to get promoted or get a raise? Does it depend on how hard you work and your results? Or is it just a matter of putting in your 5 years?
How would a promotion change your day-to-day? Would it make the job more stressful or less stressful? Would it increase your work life balance or decrease your work life balance?
Does your Boss support you getting a promotion? Will they help advocate for you once you've shown you qualify?
Is getting promoted competitive? If so, what is your competition like? Are there things they are doing you can learn from (this will not only make you more likely to get promoted, it may also make you a better employee in general).

Investigate Opportunities: Finding a New Job

This step is a little harder, but the payout is potentially huge so it's well worth your time. You'll need to spend time on job posting sites like indeed.com looking for job openings that you qualify for and cross referencing that with employee reviews and pay information at a website like glassdoor.com to see if you actually want to work at any of these places. You should also pick a few "dream companies" and browse their job listings periodically. You should try to answer the following questions.

How much more could you make by switching jobs? In some industries, you can easily get a 20%-40% raise.
How many openings are out there? Are they with companies with good culture and work life balance? Would the roles be interesting and provide growth opportunities?
What if you're willing to relocate? Does that increase the opportunities? If so, is the salary actually higher when adjusted for cost of living? Moving for a job can be scary, but also potentially a huge step forward early in your career.
Are you qualified for these jobs? If not, are there any qualifications the best positions have in common? That's something you can focus on developing.
Have you been at your current job long enough that it's not a red flag? Generally, people are more worried about job-hopping than they need to be. Were you able to deliver some value to your current employer? Or are you leaving before you've actually done anything? You should be able to produce a couple of bullet points showing you did good work for each stop on your resume. Of course if your current job is toxic or there's other mitigating circumstances, then switching sooner than normal can be okay.

Choose a Strategy

After gathering all your info, you should have everything you need to decide if you want to pursue a promotion/raise, a new position elsewhere, or both. One super important thing to keep in mind, most people don't like switching jobs. It's scary and unsettling. Making a mistake by switching is scarier than making a mistake by staying. Most companies know this and take advantage of it. This isn't evil, it's just good business. They know that you don't really want to leave, which means they can underpay you to stay. A really good raise might be 10% in your current position while you could potentially get 20%-40% by switching companies. And that's what you're really worth as an employee. But your current employer knows that you are scared to move, so they will pay you less than you're worth for your entire career if you let them.

With this in mind, weigh your options for internal and external opportunities. Compare potential income growth, the skills you would learn, the culture of the company, work life balance, opportunity for challenging yourself, etc. If there's a clear winner, pursue that path. Otherwise, it's fine to pursue both simultaneously and see which happens first.

Looking for Jobs

In my experience "job hopping" is not something that employers really care about especially early in your career. At least in tech (the only place I have experience). Switching jobs after 1.5 to 2.5 years is probably the sweet spot when you're starting out. This gives you enough time to ramp up, learn a lot, and collect some building blocks for your resume. Just a few career moves early on can make a huge difference in your lifetime earnings (as we saw with our example in part one).

A few quick notes about looking for jobs:

Applying for jobs sucks. It's exhausing. Just know that it's okay to feel like it sucks, grit your teeth, and grind through just a few applications every day.
One reason it sucks is that you should be refactoring your resume for every opening. Read the job description, and try to craft your resume to fit what they're looking for (while being honest). Emphasize your experience that's most in line with what they're looking for.
Another reason it sucks is that it takes forever to hear back, and a lot of times you don't get a response. Don't let that discourage you, that's just the way it is. I once heard back about a job a full year after I applied (then ended up getting an offer which I accepted).
Companies are okay with wasting your time. They won't feel terrible if they interview you and it's not a good fit. They'll just tell you no or ghost you. You should match that energy. Often I see people who are scared to apply for jobs if they don't 100% know they want them. If a position looks like it might be cool, and you want to know more, you should apply. Don't limit yourself. You may find out something awesome at the interview and it'll be an amazing fit. Or maybe not and you decide to decline an offer. That's fine and not something you should feel bad about.
Once you've gotten 10, 20, or 50 applications out there you should start to have some interview requests rolling in. If not, you may need to rethink your resume or what kind of jobs you're applying for. Something might be off.
When you do get an interview, make sure to research the interview process of that company. There's lots of sites that give info on previous interview experiences (glassdoor.com for example). Or you can often find interesting info by searching "interview at (the company) reddit" and seeing what people on reddit have to say. Knowing what to expect and brush up on isn't cheating, it's just planning ahead. Make sure you spend enough time prepping. You've invested a lot of time applying for jobs, now it's time to prep so you can cash in that investment, not the time to wing it.
Day of the interview make sure you take some time to relax. You know you're a good worker, you know you've prepped well, you know you're going to do your best. Take some deep breaths, you were able to get this interview and you'll be able to get another one if you need to. The worst thing you can do is stress too much and shut down mid interview. Make sure to ask any questions about the company that will help you make up your mind if you do get an offer.

Working Towards a Promotion

If you still don't want to switch jobs (are you sure you don't want to?), and a promotion/raise looks worthwhile (there's a path to get there, the pay is worth it, and you can trust your boss to be an advocate), go after it.

Let your boss know you want a promotion/raise ASAP. This is the most important thing you can do.
It may feel awkward if you're just starting out, but you can always phrase it in a way that acknowledges the growth you need instead of coming accross as entitled. For example: "Hey Boss, I'm really excited for this opportunity and want to make sure that I'm focused on the right areas while ramping up. What do I need to do to perform at the next level? My immediate goal is to perform this role well, but I want to have a clear picture of what it takes to get promoted so I know I'm focusing on growing in areas that will help the company. I want to grow as quickly as possible and I'd love any feedback you can give me."
Once you get a growth check-list from them, learn how to be excellent at those things. You still need to fulfill all your current responsibilites at an acceptable level. But don't waste energy perfecting a skill/task that is not part of your promo plan.
When possible, focus on what's visible. Doing an acceptable job completing a project that your Boss's Boss cares about is way better than absolutely crushing a project they'll never hear about.
Learn how to self-analyze and critique how well you're doing. You should have a sense of what you're doing well and where you need to improve. Do a quick check-in mentally at least once a week to see if you're still on track or if you've gotten sidetracked on something that doesn't actually matter.
Be relentless in asking for feedback, especially when you think you're doing well. This does two things: it can help you adjust your perceptions. Maybe you thought you were killing it but your Boss actually has some concerns. It's good to find that out ASAP. Even more importantly, it reinforces your Boss's picture of you as someone who is growing and getting ready for the next level. Don't underestimate how important that is. When you ask for feedback, if the conversation is generally positive ("You're doing pretty well, just keep up the good work"), try to tie it back to your promotion/raise. "Thanks, I'm glad to hear I'm doing well. What are the top three things that are missing for me to get promoted? What do you think I should be focused on?"

Wrapping Up

Ultimately, being content and enjoying life is a choice and a skill that you can develop. But there's a difference between being content and being complacent or fearful. Don't sell yourself short. You are capable of growth, and you deserve to be paid for the value you can provide. You might need to get a little uncomfortable, challenge yourself, and take some risks. But if you invest in yourself and your career strategically the rewards are well worth it.